Economics Homework Solutions
#181624
Risk, uncertainty and information
Question (1): Explain what, in auction theory, is meant by the "winner's curse'?
Question (2): State the revenue equivalence theorm, explaining the terms involved.
Question (3): Why, in the case of private values, is an English auction similar to a second-price sealed bid auction?
This post explains in simple words as well as mathematically three key theories of auction. The theories explained are winner's curse, revenue equivalence theorem and similarity of a second price sealed bid auction and English auction in case of private values (approx 800 words)
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Rohtas Kumar, MBA - 4.9/5
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- Auctions - Winners curse.doc
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